Oil’s Silent Recession Warning

In partnership with

Big investors are buying this “unlisted” stock

When the founder who sold his last company to Zillow for $120M starts a new venture, people notice. That’s why the same VCs who backed Uber, Venmo, and eBay also invested in Pacaso.

Disrupting the real estate industry once again, Pacaso’s streamlined platform offers co-ownership of premier properties, revamping the $1.3T vacation home market.

And it works. By handing keys to 2,000+ happy homeowners, Pacaso has already made $110M+ in gross profits in their operating history.

Now, after 41% YoY gross profit growth last year alone, they recently reserved the Nasdaq ticker PCSO.

Invest for $2.90/Share

_{Paid advertisement for Pacaso’s Regulation A offering. Read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals.}

1. The Oil Tape Is Telling You Something (And It’s Not Bullish)

Forget the cheerleading from OPEC and the polite optimism of Wall Street’s energy desks. Brent crude is stuck in the mid-$60s. WTI is flirting with $63. This is happening even as OPEC quietly raises its 2026 demand forecast and the dollar softens—two conditions that, historically, give oil a tailwind.

Why the disconnect? Simple: the physical market is sniffing out an economic slowdown before the equity crowd does. The EIA just trimmed near-term price expectations, citing an uptick in OPEC+ supply growth. That’s code for: “We see more barrels hitting the market than demand can soak up.”

In energy markets, the futures curve is often a more honest storyteller than an equity earnings call. And right now, that storyteller is whispering “buyer’s strike.”

2. Demand vs. Supply: The Textbook Says One Thing, Traders Say Another

OPEC+ and IEA reports are, at best, a snapshot of what bureaucrats hope the market will look like. In reality:

• Demand growth is being eroded by tighter credit, slower industrial activity, and weaker freight volumes in Asia.

• Supply growth is steady-to-up, particularly from OPEC+ members looking to squeeze every dollar out of barrels before the global energy transition gets too real.

• Refining margins are narrowing in the U.S. and Asia—meaning even the midstream players are losing some pricing power.

Traders aren’t dumb. They’re seeing forward demand downgrades in global shipping and aviation fuel. They’re watching European manufacturing PMIs stay in contraction. They know Chinese refiners are quietly reselling cargoes because domestic demand isn’t there.

The result? When the futures strip shows weakness out in the 6–12 month contracts, it’s not a technical blip—it’s the market pre-pricing a slowdown.

3. Inflation Relief Now, Earnings Headwinds Later

Here’s the paradox: falling oil is good for headline inflation numbers in the sho

rt term. Gasoline prices are one of the most visible costs consumers see every day, and lower crude translates directly into softer CPI in the months ahead.

But for corporate earnings—especially in the energy sector—it’s a different story. Lower oil prices:

• Shrink upstream profit margins.

• Reduce cash flows for capital-intensive projects.

• Discourage exploration and production investments.

• Tighten high-yield credit availability for smaller drillers.

If energy companies cut capex, that ripples into the broader economy—less equipment demand, fewer high-paying jobs, less support business for transport and logistics. In other words, today’s “inflation relief” could be tomorrow’s earnings drag.

4. The Macro Layer: Tariffs, Growth, and the Dollar

Don’t ignore the geopolitical layer. U.S. tariff policies and trade tensions are creating ripple effects in commodity flows. Even with the dollar trending weaker in recent weeks, oil has refused to rally—an important signal. In the past, a softer dollar often meant a solid bounce in commodities priced in USD. That correlation has broken.

This tells us two things:

1. Global demand weakness is overwhelming the currency effect.

2. The market is already discounting potential demand destruction from any escalation in trade friction.

Translation: if crude can’t rally on a weak dollar, you have to ask—what happens if the dollar strengthens again?

5. The Gasoline Crack Spread: The Canary in the Coal Mine

If you want a real-time gauge of oil product demand, watch the gasoline crack spread—the difference between crude prices and gasoline futures. It’s been softening. This suggests refiners are seeing less margin incentive to convert crude into gasoline because retail and wholesale demand isn’t there.

For U.S. consumers, this could translate into softer pump prices over the next month. For investors, it’s a canary in the coal mine for retail sales—lower fuel demand often coincides with slower discretionary spending.

6. Market Setups: How to Position Without Playing the Hero

When oil loses momentum despite “supportive” headlines, the path of least resistance is lower—at least until supply discipline kicks in or demand rebounds. That doesn’t mean shorting crude blindly. It means being surgical:

• Fade rallies in shale-levered E&Ps that need $75+ oil to keep cash flow healthy.

• Accumulate downstream and transport defensives—pipelines, refiners with low feedstock costs, bulk shipping firms with fixed contracts.

• Watch HY energy credit spreads—if they start widening, it’s a sign the equity slide could accelerate.

7. Recession Resistant Investment Strategy

With crude flashing a potential slowdown signal, this is when the “Recession Resistant” strategy earns its keep. It’s built around companies that keep selling no matter what—consumer staples, utilities, healthcare—sectors that don’t live and die on oil price swings.

We’re not talking about panic-hedging here. We’re talking about positioning capital where it’s less exposed to the knock-on effects of a global energy slowdown. As always, it’s rules-based and unemotional—because the best defense is the one you put in place before the market forces you to.

8. The Bigger Picture: Commodities as Forward Indicators

If you strip away the noise, commodities often act as a forward-looking economic gauge. They trade on expectations, not just current conditions. When oil stalls in the face of bullish catalysts, it’s signaling that the market sees a slower lane ahead for global growth.

The last time we saw a similar divergence—soft dollar, optimistic OPEC, and weak oil—was in late 2018. By Q4 that year, equities had their worst December since the Great Depression. History doesn’t repeat, but it rhymes.

9. Bottom Line: Listen to the Market, Not the Press Release

OPEC can print bullish forecasts all day. Analysts can project demand curves that slope gently upward. But the price tape has no agenda—it’s telling you that buyers are stepping back.

Energy markets are sending a quiet but clear message: the global economy is losing speed, and inflation relief now could be paid for with lower earnings and slower growth later.

The real alpha isn’t in chasing every headline pop—it’s in reading the tape, knowing when to get defensive, and using disciplined strategies that don’t require perfect timing.

When the barrel stays cheap, the growth story is already expensive.

See you next Monday,
Analyzed Investing

Not Financial Advice. This newsletter is for informational and educational purposes only. It does not constitute investment, legal, or tax advice. The opinions expressed are solely those of the author and do not reflect the views of any affiliated organizations or institutions. Please consult a licensed financial advisor before making any investment decisions.